That was exactly my problem.

I'm doing work in IoT, and I fully expected to retain that knowledge for the jobs afterward (for the record it was a job offer, not a current employer).

So this company could have really made my life a hassle if I quit them and went to work in a different field but was still doing IoT work. They could shut things down just to make life hard.

Yup. I work in medical devices, and a pretty niche area at that. When I left my previous company I joined a company doing essentially the same stuff, but at a much earlier stage. How could I possibly have done my job and also conformed to an agreement such as this? There's no way; I would have had to change industries.